From the Editor

As I write, Canada is in the midst of an election campaign, and it’s hard to separate the wheat from the chaff when it comes to economic projections – every party has their numbers, and every party claims the other parties’ numbers are wrong, and the net result is that nobody really knows what might happen economically in the near future.

Thankfully, we can turn our sights southward for information on what the construction equipment industry might experience in the coming months. According to experts there, improving economic conditions all around should mean good things for the construction equipment market and buyers in the coming months – and that, in turn, suggests strength for the overall construction sector.

A long-standing roadblock to large construction projects in the United States is finally being dismantled in the halls of government as agreements to advance an infrastructure plan are moving forward. According to a forecast from the Association of Equipment Manufacturers and Oxford Economics, the American Jobs Plan (AJP) will help spur growth in the economy that is likely, at a minimum, to be around three percent in 2022, but more likely to land in the six to seven percent range, depending on public health, inflation and other factors.

According to economists, the effects of the AJP would be significant, boosting output in the manufacturing and construction sector of the economy by more than three percent almost immediately thanks to double-digit increases in federal infrastructure spending, joined by similar effects at all levels of government.

What this means is that the construction equipment industry is going to see some significant benefits through the next few years, according to the AEM analysis. Manufacturers have reported a steady increase in orders for new equipment through 2021, and projections are for that to carry on – calling for a four percent increase in 2022, one percent in 2023 and six percent from 2024 through 2028.

This suggests that the construction sector is looking ahead, preparing for more contract activity across the industry and bolstering their fleets even before federal money starts to flow. Demand may be throttled by continuing supply chain issues; however, there are things still to be determined moving forward. Manufacturers have reported a steady increase in orders for new equipment through 2021, and projections are for that to carry on – calling for a four percent increase in 2022, one percent in 2023 and six percent from 2024 through 2028.

So, what does this suggest for Canada? It’s likely that we will see similar trends here as the economy steadily improves and governments bring projects to the table. Several of the major political parties have brought up infrastructure spending during the election campaign, but details – as always during an election – remain unrevealed. Even so, forecasts remain positive.

While there is little recent analysis for the Canadian construction sector – and none taking into account COVID variant surges – the general view is positive, expecting some growth each year through 2025. We here at Heavy Equipment Guide are certainly bullish as we pull together this 88-page issue, one of our largest, thanks to the enthusiasm of our industry partners.

As an industry, we still have some challenges ahead as we get out from under the coronavirus cloud, but the indications on both sides of the border are, finally, trending positive.

ltoop@baumpub.com heavyequipmentguide.ca